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Talk Outline Introduction - Geology of Northern Ireland
Petroleum Exploration
– History of exploration
– Conventional and unconventional gas resources
– Basins and exploration plays
• Northeast ‘concealed’ basins
• Southwest Carboniferous basin
– Legislation and regulation
Competition for the subsurface
Conclusions
Indigenous oil and gas resources
Could
• Enhance security of supply by reducing dependence
on imported oil, gas and coal
• Provide inward investment and create employment
• Generate income through corporation tax (30%), ring-
fenced petroleum tax (32%) and royalties (7.5%) on
petroleum production revenue
Potential for oil and gas resources in NI
– limited exploration but no production to date
History of exploration
• Petroleum legislation enacted in 1964
• First licence, in Fermanagh, in 1965
• Exploration activity modest – cycles driven by prices,
discoveries in analogous settings and technological
advances
• 10 seismic surveys and 15 exploration wells
• Some oil and gas shows but no production
BUT
Significant untested potential for both oil and gas
Concealed Basins
Reservoir Permo-Triassic sandstones
Seal Permo-Triassic
mudstones
Source Carboniferous coals & shales
Traps Structural
Stratigraphic
Secondary targets Carboniferous sandstones
Unconventional gas
Petroleum prospectivity in Northern Ireland
Southwest
Unconventional gas
Reservoir Carboniferous shales
& sandstones
Seal Carboniferous shales
Source Carboniferous shales
Traps Non-essential
Elements of conventional petroleum exploration play
Elements
Organic-rich source rock
Permeable reservoir rock
Impermeable caprock
Efficient trap
Processes
Source maturation
Trap formation
Hydrocarbon migration
Relative timing of processes is crucial!
Conventional and ‘unconventional’ gas resources Characterised by reservoir quality and production methods
Conventional
Porosity 10 – 30% Permeability 1mD – 1 Darcy
Gas is present as free gas, trapped within the pore space
between the grains of the reservoir rock
Gas will usually flow from the reservoir up to the surface under
its own pressure
Unconventional
Porosity <5% Permeability 0.01mD – 0.1mD
Gas may be present as free gas, as adsorbed gas – attached
to the rock grains – or a mixture of the two
Gas requires stimulation to be produced to the surface at
commercially viable flow rates
Petroleum exploration plays
Northeast play area –
Deep sedimentary basins concealed by Antrim basalts
Primary conventional and secondary unconventional targets
Exploration is technically challenging
Source risk, trap delineation challenges
Southwest play area –
Carboniferous sedimentary basin
Primary unconventional and secondary conventional targets
Widespread gas shows
Production challenges
Northeast Permo-Triassic Basins
Source: Carboniferous coal/shale
Reservoirs:
1. Triassic sandstones
2. Early Permian sandstones
3. Carboniferous sandstones
4. Carboniferous shales
Caprocks:
1. Triassic salt/mudstone
2. Late Permian salt/mudstone
3. Carboniferous shales
Conventional Traps:
1. Tilted fault blocks
2. Anticlines
3. Fan deposits
BM
Structural trapping styles
Examples from the Larne and Lough
Neagh Sedimentary Basins
a & b Tilted fault blocks
(a tested by Ballytober well)
c Anticline
(tested by Annaghmore well)
Source rock quality & type reservoir quality
• Good quality source rocks present in coalfields
• Both oil and gas prone source rocks - maturity ranges from oil to gas windows
Exploration results to date
• Six exploration wells
– 3 in Larne basin, 2 in Lough Neagh basin, 1 in Rathlin Basin
• Minor gas shows and oil staining in Larne and Lough Neagh basin wells
• Ballinlea well (Rathlin Basin, 2008) – recovered live oil to surface
FUNCTIONING PETROLEUM SYSTEM PROVEN
Risk Factors
• Poor imaging of sub-basalt structure
• Source rock – distribution and maturity
• Timing of migration and trap formation
• Post-migration leakage
Exploration in the Northwest Irish Carboniferous Basin
Source
Carboniferous shale
Reservoir
Carboniferous
sandstone and shale
Caprock
Carboniferous shale
Traps
1.Anticlines
2.Flower structures
3.Basin-centred gas
4.Shale gas
Source rock quality & type and reservoir quality
• Poor to moderate quality source rocks
• Maturity in wet to dry gas window
Lough Allen Basin
sandstones
Exploration results to date
• Fifteen vertical exploration wells (9 in Fermanagh, 6 in Cavan & Leitrim)
• Gas shows in all wells except Glenoo
• Exploration targets Lower Carboniferous Mullaghmore and Dowra sandstones
• widespread, thick sandstone with poor porosity and permeability
• tight gas sandstone, requires reservoir stimulation
• Dowra No. 1 well fractured in 1981, increased flow rate tenfold
• Evergreen Resources drilled six wells in 2001 and hydraulically fractured
the Mullaghmore Sandstone reservoir before running extended well tests
on five of these wells – flow rates not commercially viable
• Modelling suggests that horizontal wells might sustain commercial production
Lough Allen Basin recently re-evaluated for shale gas potential • Bundoran Shale Formation identified as prospective for shale gas
• Petroleum licence issued in Fermanagh & licensing options in Cavan/Leitrim
• Remaining potential in tight gas sandstones and better quality ‘basal
sandstones’
Shale gas – issues to be addressed
Technical/economic –
• No horizontal wells drilled yet
• Shale gas production not tested
Environmental protection –
• Water use, storage, disposal
• Pollution risks – water, air, wildlife, habitats
• Induced seismicity
Health & safety
Planning –
• Impacts of development on people, tourism, agriculture, traffic,
infrastructure, economy (local/national)
Public confidence and acceptance
NI Petroleum legislation
• Petroleum (Production) Act (Northern Ireland) 1964
• Petroleum Production Regulations (Northern Ireland) 1987
• Hydrocarbons Licensing Directive Regulations (Northern
Ireland) 2010
• Petroleum Production (Amendment) Regulations (Northern
Ireland) 2010
PPA1964 – enabling legislation
• Vests petroleum in DETI
• Powers to grant licences to “search and bore for and
get petroleum”
• Ancillary rights to land access (not used to date)
• Rights to compensation
• Powers to make regulations (fees, licence areas,
model clauses etc)
Initial Term 5 years Exploration (including well)
1st Renewal term 5 years Appraisal (further wells)
2nd Renewal term 20 years Development/production
NI Petroleum legislation
Petroleum Production Regulations (Northern Ireland) 1987
Petroleum Production (Amendment) Regulations (Northern
Ireland) 2010 • Model Clauses – general not specific
– Work Programmes
– Commencement, abandonment and plugging of wells; control of development wells
– Storage tanks, pipes and pipelines
– Avoidance of harmful methods of working (includes prevention of escape of petroleum into waters or
water-bearing strata); notification of incidents; availability of funds to discharge any liability for damage
– Safety, health & welfare of employees
– Training
– Records, samples, returns, confidentiality
– Department’s rights of access & inspection, power to execute works, right of entry
– Compensation for damage, provision of insurance (to cover Licensee and Department)
– Powers of revocation, provisions for arbitration
What can the Licensee do without additional consent?
• Desk studies – analysis of existing data, data re-processing,
re-interpretation
• Laboratory analyses of existing rock samples
• Walk-over surveys – geological mapping, outcrop sampling
Regulation of exploration activities -1
Additional consents required for:
• Environmental studies & seismic monitoring (DETI/NIEA)
• Fieldwork in ASSIs (DETI/NIEA)
• Shallow drilling (DETI/NIEA)
• Geophysical & geochemical surveys (DETI/NIEA)
• Siting and drilling of deep exploration boreholes (incl. hydraulic
fracturing) (DETI/NIEA/HSENI/Planning)
• Testing and production of hydrocarbons (DETI/NIEA/HSENI)
Regulation of exploration activities - 2
DETI’s responsibilities
• Exploration , appraisal and development programmes
– Technical Standards
– Seismic risk
– Compliance and enforcement
• Financial & technical capabilities of licensees and operators
– Insurance, bonds
– Qualifications & experience
• Application for Consent to Drill
– Well design, construction, cement & casing, testing, completion &
abandonment
• Co-ordination of consents/permits/licences?
Regulation of drilling operations
• Planning permission, with Environmental Impact Assessment
• Licensing of water abstraction, storage and disposal
• Compliance with legislation:
Health & Safety
Environmental Health
Pollution Prevention and Control
Groundwater protection
Competition for the subsurface
Permeable sandstones that are good petroleum reservoir rocks also have
potential for:
– Storage of carbon dioxide
– Deep geothermal energy potential
Additionally, in the Larne basin there are thick beds of Triassic and Permian salt
which have potential for :
– Storage of natural gas
– Compressed air energy storage
Salt exploration in the Larne area
GDL
BGE
IMSL
ISME
BGE Bord Gáis/Storengy
GDL Gaelectric Developments Ltd
• Compressed Air Energy Storage
IMSL Islandmagee Storage Ltd
ISME Irish Salt Mining & Exploration
• Active salt mine at Kilroot
PC Portland Cement
• Mining lease (not in use)
PC
Larne
Storage caverns for natural gas in Larne Lough
3D seismic
through cavern
site
Block diagram showing
possible distribution of
storage caverns
Schematic cross-section
showing dimensions of
storage cavern
Images courtesy of Islandmagee Storage Ltd
Conclusions
• Realistic prospects for indigenous resources of oil and gas onshore Northern
Ireland but further exploration needed
• Shale gas project in Lough Allen Basin; secondary potential in tight gas
sandstones and deeper ‘basal’ Carboniferous sandstones
• Three licences in Rathlin and Lough Neagh-Larne Basins with primary
conventional gas potential and secondary unconventional gas potential
• Unlicensed areas in Lough Neagh and Larne basins
• Effective regulation is critical to the successful development of these resources;
shale gas exploration and production presents new challenges
• Deep geological rock formations in Northern Ireland have several potential uses,
which may compete for the same subsurface or which may be able to co-exist at
different depths or within the same rock units at different locations
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